Surge Energy (SGY) AI Stock Analysis

• Market Cap: $604.89M
• Dividend Yield: 8.05%
• Average Volume (3M): 342.56K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.13
• Revenue Growth: -2.37%
• EPS Growth: -421.59%
• Country: CA
• Employees: 83
• Sector: Energy
• Sector Strength: 75
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.08
• Shares Outstanding: 99,325,260
• 10 Day Avg. Volume: 417,098
• 30 Day Avg. Volume: 342,559
• PEG Ratio: -0.05
• Price to Book (P/B): 0.92
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.26
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $7.97
• Price Target Upside: 20.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 52 Neutral
• Price Target: ―

Surge Energy's overall stock score reflects its financial struggles with negative profitability, balanced by robust cash flow and shareholder returns. Technical indicators suggest caution, while a high dividend yield provides some support. The company's strategic focus on generating cash flow and rewarding shareholders positively impacts its market positioning.

Positive Factors

Asset Performance

Surge exemplifies improved asset performance and favorable valuations, with its Sparky and Frobisher plays yielding some of the industry’s best wells.

Operational Performance

Quarterly production exceeded consensus expectations, showing strong operational performance.

Production and Cash Flow

Production and cash flow per share were meaningfully above expectations, while maintaining spending levels, indicating confidence in long-term growth.

Negative Factors

Capital Utilization

For every dollar spent, management added $0.68 in value, showing efficient capital utilization.

Debt Levels

The company's debt is 32% of PDP value, indicating a manageable debt level.

Market Volatility

Potential for outsized gains for Surge in the future, especially if WTI prices improve from current levels.

Surge Energy Business Overview & Revenue Model

Company Description

Surge Energy Inc. explores for, develops, and produces oil and gas in western Canada. The company holds interest in the Greater Sawn Lake assets located in Northern Alberta; Valhalla/Wembley property located in northwestern Alberta; Sparky assets located between Provost and Wainwright in eastern Alberta and western Saskatchewan; and Shaunavon properties located to the southwest of Swift Current, Saskatchewan. It holds an average working interest of approximately 84% in approximately 123,884 net developed acres and approximately 83% in approximately 68,031 net undeveloped acres in Greater Sawn area; approximately 70% in approximately 22,920 net developed acres and approximately 72% in approximately 10,680 net undeveloped acres in Valhalla area; and approximately 90 % in approximately 59,655 net developed acres and 98% in approximately 47,398 net undeveloped acres in Sparky area. As of December 31, 2021, it held interests in 362 net oil and 20 net gas wells in Greater Sawn area; 100 net oil and 9 net gas wells in Valhalla area; 424 net oil and 6 net gas wells in Sparky area; and 185 net oil wells, as well as an average working interest of approximately 100% in approximately 24,249 net developed acres and 12,021 net undeveloped acres in the Shaunavon properties. The company was formerly known as Zapata Energy Corporation and changed its name to Surge Energy Inc. in June 2010. Surge Energy Inc. was incorporated in 1998 and is headquartered in Calgary, Canada.

How the Company Makes Money

Surge Energy generates revenue primarily through the exploration, development, and production of oil and natural gas. The company's key revenue streams include the sale of crude oil, natural gas, and natural gas liquids. Surge Energy operates in core areas with substantial reserves, allowing for efficient extraction and production. Additionally, the company may engage in strategic partnerships or joint ventures to enhance operational efficiency and expand its production capabilities. Market factors such as commodity prices, production volumes, and operational efficiencies significantly influence the company's earnings.

Surge Energy Financial Statement Overview

Summary

Surge Energy exhibits mixed financial performance. Revenue growth is positive, but net income is negative, reflecting profitability challenges. The balance sheet is stable with moderate leverage, and cash flow is robust despite declining free cash flow.

Income Statement

Surge Energy's income statement reveals some challenges, with a negative net income of -$53.72 million for the latest year. The net profit margin is negative, reflecting losses despite a gross profit margin of approximately 53.64%. Revenue growth is observed in recent years, moving from $558.64 million to $665.30 million, indicating a positive trend. However, the absence of EBIT highlights operational challenges.

Balance Sheet

The balance sheet shows moderate leverage with a debt-to-equity ratio of 0.31, which is relatively stable. Stockholders' equity has decreased from $843.98 million to $738.51 million, indicating a decrease in shareholder wealth. The equity ratio stands at 54.05%, suggesting a reasonable portion of the company is financed by equity rather than debt.

Cash Flow

Cash flow analysis shows a robust operating cash flow of $278.65 million for the latest year, with free cash flow slightly declining from $84.57 million to $83.54 million. The operating cash flow to net income ratio is strong, but the free cash flow growth rate is negative, posing potential concerns for future liquidity.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
640.01M	665.29M	558.64M	734.47M	414.64M	215.82M
	Gross Profit
324.12M	356.90M	348.63M	464.61M	243.96M	86.28M
	EBIT
125.50M	121.49M	114.72M	264.21M	102.05M	-42.76M
	EBITDA
190.76M	163.24M	307.51M	340.70M	542.12M	-570.93M
	Net Income Common Stockholders
-41.84M	-53.72M	15.75M	231.72M	407.61M	-747.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.74M	7.59M	0.00	0.00	0.00	0.00
	Total Assets
1.38B	1.37B	1.48B	1.55B	1.28B	707.96M
	Total Debt
243.13M	232.12M	282.18M	347.92M	337.06M	405.60M
	Net Debt
231.39M	224.53M	282.18M	347.92M	337.06M	405.60M
	Total Liabilities
651.16M	627.64M	636.79M	711.75M	762.06M	774.18M
	Stockholders Equity
731.71M	738.51M	843.98M	838.32M	513.38M	-66.22M
Cash Flow		Free Cash Flow
91.69M	83.54M	84.57M	106.18M	-3.30M	19.42M
	Operating Cash Flow
295.33M	278.65M	266.14M	276.13M	100.48M	72.19M
	Investing Cash Flow
-157.78M	-153.00M	-177.56M	-332.27M	-16.00M	-42.67M
	Financing Cash Flow
-125.82M	-118.05M	-88.58M	56.15M	-84.48M	-29.52M

Surge Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.59
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SGY, the sentiment is Positive. The current price of 6.59 is above the 20-day moving average (MA) of 5.59, above the 50-day MA of 5.15, and above the 200-day MA of 5.44, indicating a bullish trend. The MACD of 0.27 indicates Negative momentum. The RSI at 80.50 is Negative, neither overbought nor oversold. The STOCH value of 89.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:SGY.

Surge Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TAL	74 Outperform	C$631.88M	4.77	18.60%	11.94%	11.68%	-30.95%
TNZ	69 Neutral	C$539.60M	187.11	-13.52%	―	-3.50%	-153.25%
Sector *	58 Neutral	$7.59B	3.32	-4.46%	9.96%	0.83%	-49.64%
CEI	56 Neutral	C$451.68M	―	-6.69%	―	41.39%	-61.36%
SGY	52 Neutral	$604.89M	―	-5.48%	8.05%	-2.37%	-421.59%
OBE		$390.83M	5.39	-12.88%	―	―	―
DALXF		$570.66M	37.21	3.68%	―	―	―

Surge Energy Corporate Events

Surge Energy Announces May 2025 Dividend

Surge Energy Inc. has announced a cash dividend of $0.043333 per share to be paid on May 15, 2025, for shareholders of record on April 30, 2025, reflecting the company’s commitment to enhancing shareholder returns. This announcement underscores Surge Energy’s strategic focus on generating free cash flow and leveraging high-quality oil reservoirs, which may positively impact its market positioning and stakeholder confidence.

Spark’s Take on TSE:SGY Stock

According to Spark, TipRanks’ AI Analyst, TSE:SGY is a Neutral.

Surge Energy’s overall score reflects its financial struggles with negative profitability, balanced by robust cash flow and shareholder returns. Technical indicators suggest caution, while high dividend yield and positive corporate events provide some support.

To see Spark’s full report on TSE:SGY stock, click here.

Surge Energy Announces April 2025 Dividend

Surge Energy Inc. has announced a cash dividend of $0.043333 per share, to be paid on April 15, 2025, for shareholders of record on March 31, 2025. This dividend reflects the company’s ongoing strategy to generate free cash flow and enhance shareholder returns, reinforcing its position in the oil industry.

Surge Energy Exceeds 2024 Production Targets and Boosts Shareholder Returns

Surge Energy Inc. reported strong financial and operational results for the fourth quarter and full year 2024, with production exceeding expectations and significant cash flow generation. Despite a decline in crude oil prices, the company increased its adjusted funds flow due to higher production and cost savings from new debt financing. Surge returned $19.4 million to shareholders in Q4 through dividends and share buybacks, and generated $278.6 million in cash flow from operations for the year, reflecting a 5% increase from 2023. The company’s strategic focus on core areas and financial discipline positions it well in the market.

Surge Energy Declares February Dividend for Shareholders

Surge Energy Inc. has announced a cash dividend of $0.043333 per share, to be paid on March 17, 2025, for shareholders of record on February 28, 2025. This decision reflects the company’s commitment to enhancing shareholder value by distributing returns generated from its oil production activities. The dividend is recognized as an eligible dividend under the Income Tax Act of Canada, indicating its compliance with tax regulations and its potential benefit to investors.